14 August 2018. The debit card (Maestro card, PostFinance card, V PAY) is regarded as likeable, practical and trustworthy – and thus beats all the other means of payment in Switzerland. Measured against the number of transactions, cash may still be the most frequently used means of payment in stationary trade, but in terms of overall money spent, the debit card comes in first with 37 per cent of expenses, followed by cash (36 per cent) and the credit card (36 per cent). This is revealed by the Swiss Payment Monitor of the ZHAW School of Management and Law and the University of St.Gallen, which was conducted for the first time. More than 1,000 people aged between 18 and 65 from all three linguistic regions of Switzerland were interviewed for this study in 2017.

People who use more than one means of payment in the majority

If payment behaviour was quite stable for a long time in the past, a change is beginning to emerge at present. “Although everyday life is still inconceivable without cash, the interest in other means of payment is growing among the Swiss population,” says Bettina Gehring, a ZHAW researcher and co-author of the study. A majority of interviewees use more than one means of payment and prefer different means of payment depending on individual situations. The choice of a means of payment depends on a variety of factors. Besides individual preferences, the place of payment and the overall amount play a significant role.

Situation determines the means of payment

In the high-turnover retail trade, card payments dominate, whereas cash is more frequently used in restaurants, baker’s shops, newsagents, take-aways and vending machines. In the retail trade, Swiss customers use credit cards for longer-term acquisitions, at filling stations or when they are travelling. With regard to the amount to be paid, small amounts of up to 20 francs are still overwhelmingly paid in cash; only above this amount do card payments come into their own. In amounts exceeding 500 francs, cash again becomes more relevant. In small amount transactions of up to 20 francs in the online trade, “in-app” payments such as through the SBB mobile app are predominant. Higher amounts are mainly paid through online transfers.

Security influences choice of means of payment

Security and no additional fees are the most important factors in the choice of means of payment. “The issue of security is crucial with regard to money, in particular,” says Sandro Graf, ZHAW payment expert and co-author of the study. This can also be observed in connection with the new payment options, for instance in contactless or mobile payments: “A certain scepticism is prevalent here because they are perceived to be inadequate with regard to security. This is slowing down their spread,” adds Graf.

Contactless payment with potential

New digital forms of payment are already well-known among Swiss people but, with turnover shares with a single-figure percentage, they are still used cautiously. Thus the turnover share of contactless payments is only just under 7 per cent, that of mobile payments even below 2 per cent. Nonetheless, there is a good chance that these instruments will gain ground in the future. According to Thomas Trütsch, an economist at the University of St.Gallen (HSG), there is still a great deal of potential, particularly among the users of these payment methods. “More than 70 per cent of these people could envisage using these methods more frequently in the next three years – provided that they satisfy fundamental requirements such as improved security and are capable of solving users’ genuine problems.” According to interviewees’ statements, the new means of payment still possess too little in the way of added value in comparison with the classic ones for them to consider these methods as alternatives (rather than simply as a complement).

Swiss Payment Monitor

The Swiss Payment Research Center (SPRC) of the ZHAW and the Executive School of Management, Technology and Law (ES-HSG) of the University of St.Gallen have been dealing with questions concerning “payment” independently of each other for years. They conducted the Swiss Payment Monitor together for the first time. This is the first annual Swiss payment study to combine the consumers’ perspective with a macroeconomic view. Thanks to the combination of online interviews and a diary survey linked up with public data from the Swiss National Bank (SNB), the daily use of means of payment can be mapped realistically. All in all, more than 1,000 people aged between 18 and 65 from all three linguistic regions of Switzerland were interviewed in a representative survey. The study is funded by the two research institutions, the Swiss Payment Association (SPA), as well as the industrial partners Concardis and SIX Payment Services.

Picture: Photocase / Nuchylee